It grows more and more it deflates

The US insists on rejecting the forecasts . Recession? When? The consensus expected it to grow 2% in the last quarter of last year. And it fell very short: . The economy is indomitable. . It exploded in 2021 when it recorded an expansion of 5.8% (and retail inflation overflowed . So the It grows more  FED accepted the challenge and tightened rates with a ferocious rate hike. Activity slowed but did not bottom out. Will the recession last until 2023 as predicted? No. It grew more:  It is difficult to certify the landing when the flight is never suspended or, as is currently the case, if the cruising speed increases. And the recession? It only appears in the omens of the inverted rate curve and in the concrete fall – it has been for 21 consecutive months – of the main basket of economic indicators. The stock , which also caught the feint with a bear market in 2022, embarked on a powerful bull market that same year, starting in October. The United States is in the best of all worlds.

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It barely marked 1.5%. The consensus was ignored. The second semester was incredible. The economy doubled its growth and the GDP deflator fits exactly into the inflation USA Phone Number List target, for the first time since 2020 . It is early to claim victory, there are price measurements that are not yet so meager, but it is impossible to think of anything else. Paul Volcker’s legendary FED, which in the late 1970s and early 1980s faced inflation of similar size, caused two recessions to bring it down, and never managed to reduce inflation as much as the records that Jay Powell credits without have still completed the work.  Volcker  by comparison, was a massacre. And, for the record, it would be unfair to criticize him. United States: the FED’s decision What will the FED do at its meeting this week? Nothing . If everything is done and it is not wise to celebrate in advance. Two recent causes of concern have disappeared.

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Did not weaken as feared. Another fleeting yellow light: consumer inflation rose 0.3% in December. However, the personal consumption deflator (PCE), the criterion Belgium Phone Number List used by the FED, barely rose 0.17%. In the last six months, PCE inflation showed an annualized increase of 2% (and the core version In the last three months  (and he core). jerome-powell-federal-reserve.jpg It is the best of all worlds, it has already been said. Too good to trust, Gov. Chris Waller noted long ago. But the data insist. What will the FED do in March or May? Will it lower rates as the markets want? It is at will . The central bank can do whatever it wants, it has already regained all its degrees of freedom. The economy is healthy, inflation is meekly converging toward its target, and the federal funds rate has remained stationary at  for half a year. With a generously positive real rate, Powell and his people can choose the date of their first piacere cut.

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